AMINTA’S STORY: Part 2

Aminta decides to try again, with the help of some friends

Shall we try tie-dying again?

No, let’s think of something else. My

grandmother used to make soap to sell.

Is soap-making a good idea?

• How can they find out?

• What are the women doing in this picture?

• What questions do you think they are asking?

Aminta and her friends start thinking about the things they need to buy to make soap and how much they will cost.

These are things the women will buy and keep.

They will last at least a year, so they can be used lots of times.

2500

1700

1500

Total cost

This what they need to make one batch of soap.

10 litres of water.

It does not cost any money.

2 litres of palm oil.

500g of lye.

1400

200

What is the total cost per batch?

1600

Now they can think about what they will earn.

Each mould can make 17 bars of soap.

So how many bars of soap can they make in one batch?

If they can sell 1 bar of soap for 100, how much money can they get from selling one batch?

51

5100

Aminta and her friends work out how much profit they can make per batch.

5100Income

1600Costs

less

3500gives how much PROFIT?

How much money do Aminta and her friends need to start making soap?

7500

So how many batches must they sell before they get their money back and start getting an income?

2

Aminta and her friends think making soap will provide them with a useful income.

Now they will have to decide how they should organise themselves and how much time it will all take.

And the moral of this story…?

• Plan your business idea!

• If you don’t plan properly, you will not succeed.

How to adapt this story to your local circumstances:

• Choose two products from your own locality with the following characteristics: – First product: Requires some technical skill to produce

Many local producers exist

Limited market demand– Second product: Requires some technical skill to produce

Sufficient market demand warrants more producers to produce

Potential for profitability, i.e. costs are less than the expected sales income

• Change the name of Aminta and her friends to local names.

• Substitute the first product you have chosen for the tie-dying and change all the amounts of money to fit your currency situation. Make sure you use a higher expected sales price in the part of the story illustrated in slide 5 than you do the part that is in slide 11.

• Substitute the second product you chose for the soap and change the details of the equipment and supplies to fit your product. Change all the amounts of money to fit your situation and make sure you do the complete set of calculations so that the figures work out as you wish. If the business projections do not show a profit, choose another one for the second part of the story.

• Try to use real or play money for the story presentation and consider showing trainees how to use a calculator as part of their learning experience.